San Diego County pays out $2.5 million for unused sick days

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Jeff Dusek was one of San Diego County’s most prominent prosecutors, successfully handling some of the region’s highest profile murder cases. He was known as a hard worker, who spent a lot of weekends in the office. He rarely took a sick day off in his 34 years at the District Attorney’s Office – except for gall bladder surgery.

The accumulated sick pay turned into a cash payout in January when Dusek retired. The county cut him a check for $118,605.20 – the biggest sick pay cash-out in recent years.

It’s a practice virtually unheard of in private industry, but at the County of San Diego, top tier managers and some other employees have the option of cashing out 50 percent of their unused sick time or applying 100 percent of it to their service time. If an employee has banked a year of sick leave, for instance, that time can be added to years of service to boost his or her pension.

inewsource, a nonprofit reporting center based at San Diego State University, analyzed four years of sick pay cash-outs, and found that since 2007, San Diego County has paid more than $2.5 million to 278 employees. Of the total, the county paid $686,238.93 in 2010 to 49 employees for an average payment of $14,005 a piece.

The county’s policy allows executives, some managers and unrepresented administrative employees to accumulate unlimited amounts of sick time. That amounts to about 4 percent of the workforce.

It is not unusual for government agencies to allow sick time to be translated to cash, but many have limitations. The city of San Diego, for example, does not distinguish between sick time and vacation time, but it caps the amount of unused time off most employees can accrue at 350, 600 or 700 hours, said Scott Chadwick, human resources director for the city.

Dusek, who has officially retired as chief deputy district attorney but is still working under a temporary program, said his payout was a pleasant surprise.

“I didn’t know what the policy was until the end,” he said Thursday. “I hardly ever used sick leave. I looked at it as an insurance program for catastrophic injury.”

Several employees who were covered by the cash-out policy defended it as an incentive program. They said that compensating employees for unused sick time discourages employees from using sick time when they shouldn’t.

“I think there’s something to be said for that,” said Darren Pudgil, spokesman for San Diego Mayor Jerry Sanders. “Otherwise, there might be people who take advantage of (sick leave).”

Pudgil worked for the county for almost 13 years before leaving his post as Supervisor Ron Roberts’ chief of staff in 2008 for a position in city hall. The county paid Pudgil $35,528.28 for unused sick time.

Countywide, 30 employees cashed out more than $20,000 for unused sick time. The average payment to all 278 employees over the four years was $9,119; the median was $6,000.

Full-time county employees are allowed 13 sick days a year. When they are cashed out, sick days are calculated according to the employee’s latest salary.

The high-level employees leaving the Auditor and Controller’s office from 2007 through 2010 received some of the highest average payouts of any department at about $27,000 per person.

The Department of Health and Human Services paid $363,105 to 63 employees in the past four years for an average payout of $5,763. It was the highest total amount paid out to the largest number of employees.

County Supervisor Dianne Jacob said she supports the policy because it helps the county attract the best workers.

“Allowing top managers – those with the highest level of responsibility – fair compensation for half of the sick time they don’t use is a reasonable, cost-effective way for the County to stay competitive as an employer,” she said in a statement.

Board of Supervisors Chairman Bill Horn declined to comment.

County Chief Administrative Officer Walt Ekard said the the sick pay policy is treated as one part of the wage and benefit package offered by the county to attract and retain quality personnel. To his knowledge, he said, the benefit had not been raised in cost-cutting discussions.

Jennifer Loftus, the national director for Astron Solutions, a New York-based human resources consulting firm, said the county’s policy of allowing employees to accrue unlimited sick time and then cash it out is “extremely rare” in the private sector.

Typically, there are caps, she said. One level limits the amount of sick leave per year, the second limits the total amount of sick time an employee can accrue.

Sick time is generally allotted by an employer to bridge the gap between when an employee experiences a less serious illness and the need to go on short-term or long-term disability, Loftus said.

Paying employees for unused sick time could also have practical ramifications, Loftus said. “You have to consider strongly the culture of the organization and will that encourage people to come in when they otherwise should stay home,” she said.

Matt Weatherly, president of Public Sector Personnel Consultants, a compensation consulting group based in Tempe, Ariz., said it’s not unusual for governments to reward healthy employees by letting them cash in their sick time. In his experience, the ones that do give employees 25 to 50 cents on the dollar for unused sick days, he said.

But, Weatherly said he thinks more employers will establish tiered systems that limit the amount of sick leave their employees can bank.

“Everything that I’ve read would suggest that employers are revisiting this notion,” he said.

Eric Banks, president of the Service Employees Local 221, which represents about 10,000 county employees, said he disagrees with the idea that certain high level employees can get cash for unused sick days.

Banks said a down economy has increased the need for services in the county, and that many county employees are being asked to do more with less.

“If we’re looking at cutbacks across the board, everyone should share in those cutbacks,” he said. “The actual cashing out for money is a problem because that’s money they could be using to provide services.”

Carlos Armour, another high ranking prosecutor in the DA’s office, retired in 2008 to become a Superior Court Judge. He was surprised to get a $93,597.61 check for unused sick time.

When he realized he was getting the money, “I thought, at least all those days that I came in to work when I maybe could have taken the time off, paid off in some manner.” He said he rolled some of it into his retirement account.

He thinks the policy is beneficial because it provides an incentive for employees to avoid using sick time unnecessarily.

“If you can accumulate and get some compensation at the end when you retire,” he said, “it encourages people to be on the job and not be tempted to maybe try to use their sick leave every year.”